China and India will account for more than 150 million outbound tourists by 2020, and the travel trade needs to target these markets effectively if they are to fully capitalise on the huge opportunity. This was the key message of the ‘Get Insights, Build Your Business’ workshop held yesterday at the PATA Travel Mart 2011 in New Delhi.
John Koldowski (pictured), Director of PATA’s Strategic Intelligence Centre, led the session, citing data confirming how the two markets are already burgeoning. According to Koldowski, the number of Indian (+12.9%) and Chinese (+18.1%) visitors to Asia Pacific destinations both experienced double-digit growth in the first half of 2011. This far exceeded the overall 5% rise in arrivals to Asia Pacific in the same period. China’s outbound growth was especially apparent in South and Southeast Asia, at 58.0% and 44.2% respectively. Indian arrivals to neighbouring South Asian nations jumped 47.5%.
He warned however, that tourism operators and destinations wanting to target China and Indian tourists need to realise the regional differences within these countries.
“No way can you consider India and China as homogenous markets; they differ dramatically. Each state or province has GDP power equivalent to whole nations,” Koldowski said.
Adding fuel to the statistical fire, Surekha Poddar, Executive Director of Consumer Research for Nielsen India, noted the growing affluence and confidence among Indian consumers. Citing data from a recent Nielsen survey, Ms Poddar revealed that India now ranks number one in global consumer confidence indices, with a rating of 126 compared to the global 89. In terms of spending priorities, travel now ranks second among Indian consumers at 34%, compared to the global average of 32%. Most notably, only 7% of Indian consumers now claim to have “no spare cash”, compared to the global 16%. In China this figure is even more impressive, with only 3% of consumers claiming to have no disposable income.
The online sector was clearly a strong driving force behind the rise in travel among Indian and Chinese consumers. In India, while 60% of travellers still get their information from their local travel agent, 57% also now use an internet search engine and 45% use an online travel agent (OTA). While agent bookings have also increased, bookings via OTAs have seen a larger growth in percentage terms. In China, it is notable that while the majority of travellers research their travel plans online, the majority still return to their travel agent to book their trip.
The online theme was continued by Jens Thraenhart, President and co-founder of China-based Dragon Trail, who noted that companies and destinations need to target Chinese social media sites and develop multi-media strategies in order to gain a greater share of Chinese travellers. While social media is a global trend, Thraenhart said it was especially prevalent in China, where affluent consumers are on average 20 years younger than those in the western world.
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